{"id":1673,"date":"2013-06-14T11:13:29","date_gmt":"2013-06-14T11:13:29","guid":{"rendered":"\/?p=1673"},"modified":"2013-06-14T11:13:40","modified_gmt":"2013-06-14T11:13:40","slug":"lot-78-inc-otcmktsloted-gone-no-way-back","status":"publish","type":"post","link":"\/articles\/lot-78-inc-otcmktsloted-gone-no-way-back\/","title":{"rendered":"Lot 78, Inc (OTCMKTS:LOTED) Gone, No Way Back"},"content":{"rendered":"

While we expected the drop for Lot 78, Inc (OTCMKTS:LOTED<\/a>) a bit sooner, there was no doubt of an upcoming freefall. The stock split bought the company some time, but in only two short weeks LOTED<\/a> abandoned the heights, lowering to $1.30. This would still be equivalent to more than $5 in pre-split prices, but a far cry from the peak. On Tuesday this week, LOTED<\/a> lost more than 37%. \"LOTED0614.png\" <\/p>\n

On Thursday, LOTED<\/a> lost more than 12%, following a series of even steeper drops. Also, selling volumes are growing in the past days, indicating a chain reaction that may speed up the fall even more. Levels below a dollar are an entirely realistic prediction, and LOTED<\/a> may be lost to traders for a long time before any pumper decides to touch it again. \"CNTO0614.png\"<\/p>\n

The company itself may blame short sellers, but LOTED<\/a> is more of a case of a very loud promotional campaign. This attracted too many investors, created too much optimism and lifted the shares of a small fashion house to unsustainable heights. Even without short sellers, when promotions end, investors withdraw. On its own LOTED<\/a> had little to show: a small revenue from selling high-end garments, some potential to develop a better distribution network, some interest from celebrities, but little to support the high market valuation.<\/p>\n

The latest quarterly results showed a small contribution from the fashion sales:<\/p>\n